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The Marcus Corporation Returns to Profitability in the Third Quarter of Fiscal 2021

The Company reports positive net earnings and Adjusted EBITDA for the quarter as both Marcus Theatres and Marcus Hotels & Resorts again significantly outperform their respective industries

MILWAUKEE--(BUSINESS WIRE)--Nov. 3, 2021-- The Marcus Corporation (NYSE: MCS) today reported results for the third quarter fiscal 2021 ended September 30, 2021.

“Our results for the third quarter affirm the recovery is accelerating in both our divisions,” said Gregory S. Marcus, president and chief executive officer of The Marcus Corporation. “As the company returned to profitability in the quarter, we reported nearly $25 million in Adjusted EBITDA thanks to contributions from both businesses, which again significantly outperformed their respective industries. Our competitive differentiators are the driving force behind the strong pace of our recovery. The combination of our diversified business model, comparatively lower debt than our peers, and the fact that we own most of our underlying real estate provides value to our shareholders and has allowed us to successfully navigate the pandemic and return to profitability faster than anticipated.”

Third Quarter Fiscal 2021 Highlights

  • Total revenues for the third quarter of fiscal 2021 were $145,862,000 compared to total revenues of $33,591,000 for the third quarter of fiscal 2020.
  • Operating income was $6,273,000 for the third quarter of fiscal 2021, compared to operating loss of $47,987,000 for the prior year quarter.
  • Net income attributable to The Marcus Corporation was $1,759,000 for the third quarter of fiscal 2021, compared to net loss attributable to The Marcus Corporation of $39,440,000 for the same period in fiscal 2020.
  • Net earnings per diluted common share attributable to The Marcus Corporation was $0.06 for the third quarter of fiscal 2021, compared to net loss per diluted common share attributable to The Marcus Corporation of $1.30 for the third quarter of fiscal 2020.
  • Adjusted net earnings attributable to The Marcus Corporation was $275,000 for the third quarter of fiscal 2021, compared to Adjusted net loss attributable to The Marcus Corporation of $36,992,000 for the third quarter of fiscal 2020.
  • Adjusted net earnings per diluted common share attributable to The Marcus Corporation was $0.01 for the third quarter of fiscal 2021, compared to Adjusted net loss per diluted common share attributable to The Marcus Corporation of $1.22 for the prior year quarter.
  • Adjusted EBITDA was $24,515,000 for the third quarter of fiscal 2021, compared to a loss of $25,808,000 for the comparable prior year period.
  • Adjusted loss attributable to The Marcus Corporation, Adjusted loss per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA reflect adjustments made by the company to eliminate the favorable impact of government grants received during the third quarter of fiscal 2021 and to eliminate the impact of a nonrecurring income tax adjustment and certain nonrecurring property closure expenses, reopening expenses and impairment charges during the third quarter of fiscal 2020.

First Three Quarters Fiscal 2021 Highlights

  • Total revenues for the first three quarters of fiscal 2021 were $289,196,000 compared to total revenues of $200,984,000 for the first three quarters of fiscal 2020.
  • Operating loss was $55,498,000 for the first three quarters of fiscal 2021, compared to operating loss of $123,249,000 for the first three quarters of fiscal 2020.
  • Net loss attributable to The Marcus Corporation was $49,737,000 for the first three quarters of fiscal 2021, compared to net loss attributable to The Marcus Corporation of $85,821,000 for the first three quarters of fiscal 2020.
  • Net loss per diluted common share attributable to The Marcus Corporation was $1.66 for the first three quarters of fiscal 2021, compared to net loss per diluted common share attributable to The Marcus Corporation of $2.84 for the first three quarters of fiscal 2020.
  • Adjusted net loss attributable to The Marcus Corporation was $49,403,000 for the first three quarters of fiscal 2021, compared to Adjusted net loss attributable to The Marcus Corporation of $88,688,000 for the first three quarters of fiscal 2020.
  • Adjusted net loss per diluted common share attributable to The Marcus Corporation was $1.64 for the first three quarters of fiscal 2021, compared to Adjusted net loss per diluted common share attributable to The Marcus Corporation of $2.93 for the first three quarters of fiscal 2020.
  • Adjusted EBITDA was $5,830,000 for the first three quarters of fiscal 2021, compared to a loss of $43,804,000 for the first three quarters of fiscal 2020.
  • Adjusted loss attributable to The Marcus Corporation, Adjusted loss per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA reflect adjustments made by the company to eliminate the favorable impact of government grants received and the impact of impairment charges during the first three quarters of fiscal 2021, as well as the impact of a favorable income tax adjustment and certain nonrecurring property closure expenses, reopening expenses and impairment charges during the first three quarters of fiscal 2020.

Marcus Theatres®

Bolstered by increasing vaccination rates, improving consumer confidence and the release of a greater number of high-performing new films, the division’s operating loss improved significantly in the third quarter of fiscal 2021. For the first time since the pandemic began, Marcus Theatres returned to positive Adjusted EBITDA in the third quarter of fiscal 2021.

Comparing admission revenues to pre-pandemic fiscal 2019 results, Marcus Theatres significantly outperformed the industry by nearly 8 percentage points during the third quarter of fiscal 2021 and by 6 percentage points during the first three quarters of fiscal 2021, according to data received from Comscore. Based on this data, the company believes Marcus Theatres continues to be one of the top performing theatre circuits in the United States.

“We are optimistic about the continuing rebound in the movie theatre industry and at Marcus Theatres in particular,” said Rolando Rodriguez, chairman, president and chief executive officer of Marcus Theatres. “The film studios continued to release exciting new films during the quarter, driving significant improvement in attendance across our circuit. Our guests are continuing to enjoy the moviegoing experience as evidenced by strong concession revenues during both the quarter and first three quarters of fiscal 2021, which further contributed to our results. As more consumers return to seeing movies the way they are meant to be seen, we are encouraged by the growing number of studios who have publicly recognized the importance of the exclusive theatrical window to the success of their films.”

The highest grossing films in the fiscal 2021 third quarter included “Black Widow,” “Shang-Chi and the Legend of the Ten Rings,” “Jungle Cruise,” “Free Guy,” and “Space Jam: A New Legacy.” Momentum continued into October, as the division experienced its best month at the box office in the COVID era, with films such as “Venom: Let There Be Carnage,” “The Addams Family 2,” “No Time to Die,” “Halloween Kills,” and “Dune” contributing to early fourth quarter results. Highly anticipated new films scheduled for release in the remainder of the fourth quarter of fiscal 2021 include “Eternals,” “Ghostbusters: Afterlife,” “King Richard,” “Encanto,” “West Side Story,” “Spider-Man: No Way Home,” “Sing 2,” “The Kings Man,” and “The Matrix Resurrections.” Looking ahead to 2022, the film slate is expected to remain very strong, including a long list of familiar titles and franchises.

Marcus® Hotels & Resorts

Marcus Hotels & Resorts again experienced strong operating performance in the third quarter of fiscal 2021, with all eight company-owned hotels and resorts contributing to our significantly improved results. RevPAR increased at all company-owned properties during the third quarter of fiscal 2021 compared to the same period in the year prior. For the second straight quarter, Marcus Hotels & Resorts reported positive Adjusted EBITDA.

Comparing RevPAR to pre-pandemic fiscal 2019 results, Marcus Hotels & Resorts continued to significantly outperform the industry by approximately 14 and 11 percentage points for the third quarter of fiscal 2021 and first three quarters of fiscal 2021, respectively. The division also outperformed its competitive sets during the third quarter and first three quarters by approximately 7 and 8 percentage points, respectively.

“Our operating results significantly exceeded expectations during the quarter,” said Michael Evans, president of Marcus Hotels & Resorts. “While we are not yet back to 2019 levels, total revenues for the third quarter of fiscal 2021 were approximately 88 percent of what was reported in the third quarter of fiscal 2019, a sign that the rebound is making considerable progress. The drive-to-leisure consumer continues to push the most demand at all our company-owned properties during the quarter. In particular, the return of special events such Milwaukee’s Summerfest, Major League Baseball, the Milwaukee Bucks championship run, and the Ryder Cup served as significant demand and pricing drivers during the quarter. Average daily rate during the quarter exceeded pre-pandemic levels from the third quarter of fiscal 2019 by approximately 10 percent and several of our properties experienced multiple periods where they were at or near sellout capacity during the quarter. As we head into the traditionally slower winter months, we are optimistic that business travel will continue to gradually return as more people become vaccinated and remaining business travel restrictions ease.”

Group booking pace for fiscal 2022, while still behind the pre-pandemic pace, has meaningfully improved from earlier in the year. Increased booking activity has extended into the fourth quarter of fiscal 2021. Banquet and catering booking pace, while also behind pre-pandemic levels, continues to benefit from increases in wedding bookings.

Marcus Hotels & Resorts assumed management of the Hyatt Regency Coralville Hotel & Conference Center effective August 18, 2021. Located just three miles from the University of Iowa, the property boasts one of the area’s most desired locations for travelers as well as large scale meetings, events, exhibitions and more. The property will undergo a phased renovation focused on its restaurant and all hotel rooms. As a recognized leader in property management, Marcus Hotels & Resorts will continue to seek opportunities to strategically grow its portfolio.

Balance Sheet and Liquidity

The Marcus Corporation’s financial position remains strong, with $197 million in cash and revolving credit availability at the end of the fiscal 2021 third quarter. As previously announced, on July 13, 2021, the company amended its revolving credit agreement and made an early payment on its term loan facility, reducing the balance of the facility to $50 million and extending the term loan facility’s maturity date to September 2022.

“As has been the case throughout our 86-year history, our strong liquidity and low debt has positioned us well during various economic cycles,” said Douglas Neis, executive vice president and chief financial officer of The Marcus Corporation. “Moreover, our significant real estate portfolio keeps our exposure to fixed monthly lease payments low, thereby accelerating our return to profitability, and serves as meaningful underlying credit support for our balance sheet. As a result, we have greater flexibility to continue navigating the impacts of the global pandemic while seeking strategic growth opportunities when appropriate that others may not.”

In the third quarter of fiscal 2021 the company realized additional proceeds from the sale of non-core real estate assets and increased the number of additional non-core assets under either letter of intent or contract to sell. The company also anticipates the receipt of expected income tax refunds in the fourth quarter of fiscal 2021.

Conference Call and Webcast

The Marcus Corporation management will hold a conference call today, Wednesday, November 3, 2021 at 10:00 a.m. Central/11:00 a.m. Eastern time. Interested parties may listen to the call live on the internet through the investor relations section of the company's website: www.marcuscorp.com, or by dialing

1-574-990-3059 and entering the passcode 6594275. Listeners should dial in to the call at least 5-10 minutes prior to the start of the call or should go to the website at least 15 minutes prior to the call to download and install any necessary audio software.

A telephone replay of the conference call will be available through Wednesday, November 10, 2021, by dialing 1-855-859-2056 and entering passcode 6594275. The webcast will be archived on the company’s website until its next earnings release.

Non-GAAP Financial Measures

Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA have been presented in this press release as supplemental measures of financial performance that are not required by, or presented in accordance with, GAAP. The company defines Adjusted net earnings (loss) attributable to The Marcus Corporation as net earnings (loss) attributable to The Marcus Corporation adjusted to eliminate the impact of certain items that the company does not consider indicative of its core operating performance and the tax effect related to those items. The company defines Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation as Adjusted net earnings (loss) attributable to The Marcus Corporation divided by diluted weighted average shares outstanding. The company defines Adjusted EBITDA as net earnings (loss) attributable to The Marcus Corporation before investment income or loss, interest expense, other expense, gain or loss on disposition of property, equipment and other assets, equity earnings or losses from unconsolidated joint ventures, net earnings or losses attributable to noncontrolling interests, income taxes and depreciation and amortization, adjusted to eliminate the impact of certain items that the company does not consider indicative of its core operating performance. Reconciliations of these measures to the equivalent measures under GAAP are set forth in the attached tables.

Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA are key measures used by management and the company’s board of directors to assess the company’s financial performance and enterprise value. The company believes that Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA are useful measures, as they eliminate certain expenses that are not indicative of the company’s core operating performance and facilitate a comparison of the company’s core operating performance on a consistent basis from period to period. The company also uses Adjusted EBITDA as a basis to determine certain annual cash bonuses and long-term incentive awards, to supplement GAAP measures of performance to evaluate the effectiveness of its business strategies, to make budgeting decisions, and to compare its performance against that of other peer companies using similar measures. Adjusted net earnings, Adjusted diluted earnings per share and Adjusted EBITDA are also used by analysts, investors and other interested parties as performance measures to evaluate industry competitors.

Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA are non-GAAP measures of the company’s financial performance and should not be considered as alternatives to net earnings (loss) or diluted earnings (loss) per share as a measure of financial performance, or any other performance measure derived in accordance with GAAP and they should not be construed as an inference that the company’s future results will be unaffected by unusual or non-recurring items. Additionally, Adjusted net earnings (loss) attributable to The Marcus Corporation and Adjusted EBITDA are not intended to be measures of liquidity or free cash flow for management’s discretionary use. In addition, these non-GAAP measures exclude certain non-recurring and other charges. Each of these non-GAAP measures has its limitations as an analytical tool, and you should not consider them in isolation or as a substitute for analysis of the company’s results as reported under GAAP. In evaluating Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA, you should be aware that in the future the company will incur expenses that are the same as or similar to some of the items eliminated in the adjustments made to determine Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA, such as acquisition expenses, preopening expenses, accelerated depreciation, impairment charges and other adjustments. The company’s presentation of Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA should not be construed to imply that the company’s future results will be unaffected by any such adjustments. Definitions and calculations of Adjusted net earnings (loss), Adjusted diluted earnings (loss) per share and Adjusted EBITDA differ among companies in our industries, and therefore Adjusted net earnings (loss), Adjusted diluted earnings (loss) per share and Adjusted EBITDA disclosed by the company may not be comparable to the measures disclosed by other companies.

About The Marcus Corporation

Headquartered in Milwaukee, The Marcus Corporation is a leader in the lodging and entertainment industries, with significant company-owned real estate assets. The Marcus Corporation’s theatre division, Marcus Theatres®, is the fourth largest theatre circuit in the U.S. and currently owns or operates 1,064 screens at 85 locations in 17 states under the Marcus Theatres, Movie Tavern® by Marcus and BistroPlex® brands. The company’s lodging division, Marcus® Hotels & Resorts, owns and/or manages 19 hotels, resorts and other properties in nine states. For more information, please visit the company’s website at www.marcuscorp.com.

Certain matters discussed in this press release are “forward-looking statements” intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements may generally be identified as such because the context of such statements include words such as we “believe,” “anticipate,” “expect” or words of similar import. Similarly, statements that describe our future plans, objectives or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties which may cause results to differ materially from those expected, including, but not limited to, the following: (1) the adverse effects of the COVID-19 pandemic on our theatre and hotels and resorts businesses, results of operations, liquidity, cash flows, financial condition, access to credit markets and ability to service our existing and future indebtedness; (2) the duration of the COVID-19 pandemic and related government restrictions and social distancing requirements and the level of customer demand following the relaxation of such requirements; (3) the availability, in terms of both quantity and audience appeal, of motion pictures for our theatre division (particularly following the COVID-19 pandemic, during which the production of new movie content temporarily ceased and release dates for motion pictures have been postponed), as well as other industry dynamics such as the maintenance of a suitable window between the date such motion pictures are released in theatres and the date they are released to other distribution channels; (4) the effects of adverse economic conditions in our markets, including but not limited to, those caused by the COVID-19 pandemic; (5) the effects of adverse economic conditions, including but not limited to, those caused by the COVID-19 pandemic, on our ability to obtain financing on reasonable and acceptable terms, if at all; (6) the effects on our occupancy and room rates caused by the COVID-19 pandemic and the effects on our occupancy and room rates of the relative industry supply of available rooms at comparable lodging facilities in our markets once hotels and resorts have more fully reopened; (7) the effects of competitive conditions in our markets; (8) our ability to achieve expected benefits and performance from our strategic initiatives and acquisitions; (9) the effects of increasing depreciation expenses, reduced operating profits during major property renovations, impairment losses, and preopening and start-up costs due to the capital intensive nature of our business; (10) the effects of weather conditions, particularly during the winter in the Midwest and in our other markets; (11) our ability to identify properties to acquire, develop and/or manage and the continuing availability of funds for such development; (12) the adverse impact on business and consumer spending on travel, leisure and entertainment resulting from terrorist attacks in the United States, other incidents of violence in public venues such as hotels and movie theatres or epidemics (such as the COVID-19 pandemic); and (13) a disruption in our business and reputational and economic risks associated with civil securities claims brought by shareholders. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, including developments related to the COVID-19 pandemic, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. Our forward-looking statements are based upon our assumptions, which are based upon currently available information, including assumptions about our ability to manage difficulties associated with or related to the COVID-19 pandemic; the assumption that our theatre closures, hotel closures and restaurant closures are not expected to be permanent or to re-occur; the continued availability of our workforce; and the temporary and long-term effects of the COVID-19 pandemic on our business. Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are made only as of the date of this press release and we undertake no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

THE MARCUS CORPORATION
Consolidated Statements of Earnings (Loss)
(Unaudited)
(in thousands, except per share data)
 
13 Weeks Ended 39 Weeks Ended
Sept. 30, Sept. 24, Sept. 30, Sept. 24,

2021

2020

2021

2020

Revenues:
Theatre admissions

$

38,250

 

$

3,118

 

$

73,850

 

$

58,667

 

Rooms

 

30,917

 

 

9,772

 

 

57,293

 

 

27,618

 

Theatre concessions

 

35,952

 

 

3,243

 

 

68,932

 

 

50,277

 

Food and beverage

 

16,731

 

 

5,420

 

 

32,234

 

 

19,620

 

Other revenues

 

19,128

 

 

8,813

 

 

45,253

 

 

30,886

 

 

140,978

 

 

30,366

 

 

277,562

 

 

187,068

 

Cost reimbursements

 

4,884

 

 

3,225

 

 

11,634

 

 

13,916

 

Total revenues

 

145,862

 

 

33,591

 

 

289,196

 

 

200,984

 

 
Costs and expenses:
Theatre operations

 

40,513

 

 

14,150

 

 

87,660

 

 

76,806

 

Rooms

 

9,682

 

 

4,611

 

 

22,019

 

 

16,132

 

Theatre concessions

 

15,094

 

 

2,592

 

 

29,627

 

 

25,634

 

Food and beverage

 

12,344

 

 

5,109

 

 

25,520

 

 

20,725

 

Advertising and marketing

 

4,827

 

 

1,981

 

 

11,195

 

 

8,446

 

Administrative

 

16,536

 

 

11,645

 

 

45,815

 

 

40,555

 

Depreciation and amortization

 

17,730

 

 

18,690

 

 

54,203

 

 

56,568

 

Rent

 

6,544

 

 

6,594

 

 

19,229

 

 

19,876

 

Property taxes

 

4,935

 

 

5,950

 

 

14,142

 

 

18,004

 

Other operating expenses

 

6,500

 

 

6,266

 

 

19,918

 

 

18,094

 

Impairment charges

 

-

 

 

765

 

 

3,732

 

 

9,477

 

Reimbursed costs

 

4,884

 

 

3,225

 

 

11,634

 

 

13,916

 

Total costs and expenses

 

139,589

 

 

81,578

 

 

344,694

 

 

324,233

 

 
Operating income (loss)

 

6,273

 

 

(47,987

)

 

(55,498

)

 

(123,249

)

 
Other income (expense):
Investment income (loss)

 

(7

)

 

66

 

 

153

 

 

207

 

Interest expense

 

(4,600

)

 

(4,132

)

 

(14,350

)

 

(10,177

)

Other expense

 

(625

)

 

(590

)

 

(1,881

)

 

(1,771

)

Gain (loss) on disposition of property, equipment and other assets

 

868

 

 

(251

)

 

2,908

 

 

(299

)

Equity losses from unconsolidated joint ventures

 

-

 

 

(1,054

)

 

-

 

 

(1,539

)

 

(4,364

)

 

(5,961

)

 

(13,170

)

 

(13,579

)

 
Earnings (loss) before income taxes

 

1,909

 

 

(53,948

)

 

(68,668

)

 

(136,828

)

Income tax expense (benefit)

 

150

 

 

(14,508

)

 

(18,931

)

 

(50,984

)

Net earnings (loss) attributable to The Marcus Corporation

 

1,759

 

 

(39,440

)

 

(49,737

)

 

(85,844

)

Net loss attributable to noncontrolling interests

 

-

 

 

-

 

 

-

 

 

(23

)

Net earnings (loss) attributable to The Marcus Corporation

$

1,759

 

$

(39,440

)

$

(49,737

)

$

(85,821

)

 
Net earnings (loss) per common share attributable to
The Marcus Corporation - diluted

$

0.06

 

$

(1.30

)

$

(1.66

)

$

(2.84

)

 
Weighted average shares outstanding - diluted

 

31,469

 

 

31,064

 

 

31,340

 

 

31,033

 

THE MARCUS CORPORATION
Condensed Consolidated Balance Sheets
(In thousands)
 
(Unaudited) (Audited)
September 30, December 31,

2021

2020

 
Assets:
 
Cash and cash equivalents

$

8,629

$

6,745

Restricted cash

 

6,346

 

7,343

Accounts receivable

 

18,808

 

6,359

Government grants receivable

 

-

 

4,913

Refundable income taxes

 

23,051

 

27,934

Assets held for sale

 

12,773

 

4,117

Other current assets

 

14,360

 

10,406

Property and equipment, net

 

787,267

 

848,328

Operating lease right-of-use assets

 

220,556

 

229,660

Other assets

 

97,256

 

108,373

 
Total Assets

$

1,189,046

$

1,254,178

 
Liabilities and Shareholders' Equity:
 
Accounts payable

$

21,141

$

13,158

Taxes other than income taxes

 

17,277

 

18,308

Other current liabilities

 

68,650

 

65,787

Short-term borrowings

 

49,796

 

87,194

Current portion of finance lease obligations

 

2,666

 

2,783

Current portion of operating lease obligations

 

17,010

 

19,614

Current maturities of long-term debt

 

11,712

 

10,548

Finance lease obligations

 

17,796

 

19,744

Operating lease obligations

 

220,075

 

230,550

Long-term debt

 

236,611

 

193,036

Deferred income taxes

 

22,061

 

33,429

Other long-term obligations

 

61,945

 

61,304

Equity

 

442,306

 

498,723

 
Total Liabilities and Shareholders' Equity

$

1,189,046

$

1,254,178

THE MARCUS CORPORATION
Business Segment Information
(Unaudited)
(In thousands)
 
Theatres Hotels/
Resorts
Corporate
Items
Total
13 Weeks Ended September 30, 2021
Revenues

$

79,996

 

$

65,803

 

$

63

 

$

145,862

 

Operating income (loss)

 

(2,604

)

 

13,458

 

 

(4,581

)

 

6,273

 

Depreciation and amortization

 

12,636

 

 

5,018

 

 

76

 

 

17,730

 

 
13 Weeks Ended September 24, 2020
Revenues

$

7,354

 

$

26,178

 

$

59

 

$

33,591

 

Operating loss

 

(37,174

)

 

(6,925

)

 

(3,888

)

 

(47,987

)

Depreciation and amortization

 

13,353

 

 

5,210

 

 

127

 

 

18,690

 

 
39 Weeks Ended September 30, 2021
Revenues

$

154,859

 

$

134,079

 

$

258

 

$

289,196

 

Operating income (loss)

 

(46,458

)

 

5,511

 

 

(14,551

)

 

(55,498

)

Depreciation and amortization

 

38,807

 

 

15,192

 

 

204

 

 

54,203

 

 
39 Weeks Ended September 24, 2020
Revenues

$

118,414

 

$

82,253

 

$

317

 

$

200,984

 

Operating loss

 

(78,788

)

 

(32,459

)

 

(12,002

)

 

(123,249

)

Depreciation and amortization

 

40,245

 

 

15,955

 

 

368

 

 

56,568

 

 
Corporate items include amounts not allocable to the business segments. Corporate revenues consist
principally of rent and the corporate operating loss includes general corporate expenses. Corporate
information technology costs and accounting shared services costs are allocated to the business segments
based upon several factors, including actual usage and segment revenues.
 
Supplemental Data
(Unaudited)
(In thousands)
 
13 Weeks Ended 39 Weeks Ended
Sept. 30, Sept. 24, Sept. 30, Sept. 24,
Consolidated

2021

2020

2021

2020

Net cash flow provided by (used in) operating activities

$

11,738

 

$

(25,633

)

$

2,057

 

$

(80,649

)

Net cash flow provided by (used in) investing activities

 

12,993

 

 

(2,570

)

 

9,248

 

 

(11,709

)

Net cash flow provided by (used in) financing activities

 

(24,886

)

 

(43,025

)

 

(10,418

)

 

83,493

 

Capital expenditures

 

(2,926

)

 

(2,802

)

 

(9,121

)

 

(18,687

)

 
THE MARCUS CORPORATION
 
Reconciliation of Adjusted net earnings (loss) and Adjusted net earnings (loss) per diluted common share
(Unaudited)
(In thousands, except per share data)
13 Weeks Ended 39 Weeks Ended
Sept. 30, Sept. 24, Sept. 30, Sept. 24,

2021

2020

2021

2020

Net earnings (loss) attributable to The Marcus Corporation

$

1,759

 

$

(39,440

)

$

(49,737

)

$

(85,821

)

Add (deduct):
Adjustment to income taxes (a)

 

168

 

 

(17,420

)

Property closure/reopening expenses - theatres (b)

 

-

 

 

1,173

 

 

-

 

 

4,630

 

Property closure/reopening expenses - hotels (c)

 

-

 

 

443

 

 

-

 

 

5,484

 

Impairment charges (d)

 

-

 

 

765

 

 

3,732

 

 

9,477

 

Joint venture impairment charge (e)

 

811

 

 

811

 

Government grants (f)

 

(2,009

)

 

-

 

 

(3,280

)

 

-

 

Tax impact of adjustments to net earnings (g)

 

525

 

 

(912

)

 

(118

)

 

(5,849

)

Adjusted net earnings (loss) attributable to The Marcus Corporation

$

275

 

$

(36,992

)

$

(49,403

)

$

(88,688

)

 
Weighted average shares outstanding - diluted

 

31,469

 

 

31,064

 

 

31,340

 

 

31,033

 

 
Net earnings (loss) per diluted common share attributable to The Marcus Corporation

$

0.06

 

$

(1.30

)

$

(1.66

)

$

(2.84

)

Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation

$

0.01

 

$

(1.22

)

$

(1.64

)

$

(2.93

)

 
(a) Reflects a nonrecurring adjustment to income taxes related to several accounting method changes and the impact of the CARES Act, which allows net operating loss carrybacks to a higher federal income tax rate year.
(b) Reflects nonrecurring costs related to the required closure of all of the company's movie theatres due to the COVID-19 pandemic, plus subsequent nonrecurring costs related to reopening theatres.
(c) Reflects nonrecurring costs related to the closure of the company's hotels and resorts due to reduced occupancy as a result of the COVID-19 pandemic, plus subsequent nonrecurring costs related to reopening hotels.
(d) Impairment charges related to surplus theatre real estate for the fiscal 2021 periods and intangible assets (trade name) and several theatre locations for the fiscal 2020 periods.
(e) Impairment charge related to an investment in a joint venture
(f) Reflects nonrecurring state government grants awarded to our theatres and hotels for COVID-19 relief.
(g) Represents the tax effect related to adjustments (b), (c), (d), (e) and (f) to net earnings (loss), calculated using a statutory tax rate of 26.1% for the fiscal 2021 periods and 28.7% for the fiscal 2020 periods.
 
THE MARCUS CORPORATION
     
Reconciliation of Net earnings (loss) to Adjusted EBITDA
(Unaudited)
(In thousands)

13 Weeks Ended

39 Weeks Ended

Sept. 30,   Sept. 24, Sept. 30,   Sept. 24,

 

2021

 

 

 

2020

 

 

2021

 

 

 

2020

 

Net earnings (loss) attributable to The Marcus Corporation

$

1,759

 

 

$

(39,440

)

$

(49,737

)

 

$

(85,821

)

Add (deduct):    
Investment income

 

7

 

 

 

(66

)

 

(153

)

 

 

(207

)

Interest expense

 

4,600

 

 

 

4,132

 

 

14,350

 

 

 

10,177

 

Other expense

 

625

 

 

 

590

 

 

1,881

 

 

 

1,771

 

(Gain) loss on disposition of property, equipment and other assets

 

(868

)

 

 

251

 

 

(2,908

)

 

 

299

 

Equity losses from unconsolidated joint ventures

 

-

 

 

 

1,054

 

 

-

 

 

 

1,539

 

Net loss attributable to noncontrolling interests

 

-

 

 

 

0

 

 

0

 

 

 

(23

)

Income tax expense (benefit)

 

150

 

 

 

(14,508

)

 

(18,931

)

 

 

(50,984

)

Depreciation and amortization

 

17,730

 

 

 

18,690

 

 

54,203

 

 

 

56,568

 

Share-based compensation expenses (a)

 

2,521

 

 

 

1,108

 

 

6,673

 

 

 

3,286

 

Property closure/reopening expenses - theatres (b)

 

-

 

 

 

1,173

 

 

-

 

 

 

4,630

 

Property closure/reopening expenses - hotels (c)

 

-

 

 

 

443

 

 

-

 

 

 

5,484

 

Impairment charges (d)

 

-

 

 

 

765

 

 

3,732

 

 

 

9,477

 

Government grants (e)

 

(2,009

)

 

 

-

 

 

(3,280

)

 

 

-

 

Adjusted EBITDA

$

24,515

 

 

$

(25,808

)

$

5,830

 

 

$

(43,804

)

     
(a) Non-cash charges related to share-based compensation programs.
(b) Reflects nonrecurring costs (primarily payroll) related to the required closure of all of the company's movie theatres due to the COVID-19 pandemic, plus subsequent nonrecurring costs related to reopening theatres.
(c) Reflects nonrecurring costs related to the closure of the company's hotels and resorts due to reduced occupancy as a result of the COVID-19 pandemic, plus subsequent nonrecurring costs related to reopening hotels.
(d) Impairment charges related to surplus theatre real estate for the fiscal 2021 periods and intangible assets (trade name) and several theatre locations for the fiscal 2020 periods.
(e) Reflects nonrecurring state government grants awarded to our theatres and hotels for COVID-19 relief.

 

Douglas A. Neis
(414) 905-1100

Source: The Marcus Corporation

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